Recently, the Mattala Rajapaksa International Airport has gotten a lot of attention again. After the government of Sri Lanka issued a Call for Expression of Interest (EOI) for the development of the airport, 47 parties responded to the call. As a result, the government has extended the timeframe for EOI submissions for one month, allowing bidders more time to gather the required documentation and submit it to the government. This indicates the airport is no longer being considered as a distressed asset but as an attractive commercially viable asset.
The call for EOI was issued by the Ministry of Ports and Civil Aviation on behalf of Airport and Aviation Services (Sri Lanka) (Private) Limited, which is seeking investor partners to further develop the airport through a structured development process. The proposal is broken down into two primary components: Aerodrome Operations—Airside (inside the inner perimeter of the airport) and Airport Operations—Landside (both the outer and inner zones of the airport). According to Minister Arjuna Karunatilake, approximately 40 parties have expressed interest in the airport, demonstrating the overall level of interest and diversity of that interest in the marketplace.
In addition to suffering from poor infrastructure, Mattala’s geography has placed it in a unique position. Being that the airport is located very close to Hambantota Port, you have a location within Sri Lanka that will be of interest to many parties involved in the commercial aviation business for many years. The Daily Mirror has also reported that the airport is a potential strategic asset because of the geopolitical competition in this geographic area. Reports in the Indian press have indicated that New Delhi sees opportunities to have a foothold in this location where China already has a significant presence through the port. Put differently, the situation is not just a bidding competition for the operations of the airport; therefore, the contest is a competition for ownership of strategically located real estate in the Indian Ocean corridor.
For many years now, the airport has carried that weight as well. It was built (US$209 million investment) with an initial funding source being China’s Export-Import Bank in 2013. Since then, Mattala has been referenced on numerous occasions as one of Sri Lanka’s most debatable infrastructure projects, given its location, limited use/low traffic, and regular doubts about its commercial viability. In an article dated 2024, Reuters states that Sri Lanka will transfer the operations of the airport to Indian and Russian companies for 30 years in their continuing attempts to decrease the losses related to government-owned businesses, and as a result, the current request for investors is part of the longer-term efforts of reimagining the future of this airport.
Given this opportunity for investment, the large scale of the asset, its location, and future potential can provide significant appeal. Mattala airport assets provide more redevelopment opportunity than most others, especially those connecting aviation, logistics, tourism, and strategic transport routes. The long response to the proposal and the hundreds of replies show that local and international investors think this airport has enormous potential, given its limited use. How Mattala is ultimately developed as an aviation hub, logistics site, or mixed-use project will depend on how the next round of bidders translate their interest into viable proposals. What is now evident is that Mattala Airport is no longer being viewed strictly as an example of waste but rather as a developed asset that will continue to change the manner in which Sri Lanka is viewed in the region economically.
